Mirshorai Economic Zone Road Show
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Transcript of Mirshorai Economic Zone Road Show
Background Opportunities
• Largest EZ in south Asia (7716 acre)
• Only natural deep sea port in Bangladesh
• Geographical advantage as a gateway toserve the hinterland of Bangladesh, Eastern India and South-western China
Background Opportunities
STRENGTHS • Abundant natural resources• Labor resource with lower cost base• Sufficient land resources for development
Background- The Economic Engine of Mirshorai EZ
Economic Engine
Economic Engine
CateringDomesticMarket
CateringDomesticMarket
FDIGeneration
FDIGeneration
EmploymentGeneration
EmploymentGeneration
• Generate jobs for local• Befit local skill sets• Export oriented
• Generate jobs for local• Befit local skill sets• Export oriented
• Investment in Fixed Assets• Transfer of technologies• Develop higher skills
Background- The Development Framework of Mirshorai EZ
MEZ
Manufacturing Processing Logistics SupplyBase
Inclusive (create jobs, local participation)
Economically Sustainable
Environmentally Sensitive
Background : Development Suitability Analysis Protect
Environment
Reduceconstructioncost
Reduceconstructioncost
Access toinfrastructure
Minimize impactson existingsettlements
Minimize impactson existingsettlements
Minimizerisk
Minimizerisk
Economic Zone- Proposed Location
• Located 50 KM west of Chittagong City ( Commercial City of Bangladesh) •900 hectares for Phase 1development• Total Land size 7716 acre • Adjacent with the Bay of Bengal
Integrated Residential Area – Proposed Location
• Located close to the Bay of Bengal • A beach to the south• Longest Sea beach within 120 KM• International School within 10 KM
Macro Economy Bangladesh key Economy Indicators
Population 160 million (estimated)
Area 147,570 km
GDP Growth 6% (average)
Total Exports US$ 23.76 billion (2012-13)*
Per capita GDP US$ 1084 (2013-14P)**
FDI Inflow US$ 1730 million (2013)*
Major Maritime Ports
Chittagong and Mongla
Major Cities Dhaka and Chittagong
Commodity wise export 2012-13
Macro Economy– Drivers for Bangladesh economic growth
• Since 2005, Bangladesh has sustained an annual Gross Domestic Product (GDP) growth of approximately 6.3%. This growth can be attributed to the introduction of stable macro-economic and monetary policies, rising industry and service outputs, and a continued high level of remittances coming into the country from the diaspora. In the future, the Government of Bangladesh’s (GoB) maingoal is to generate an overall increase in real GDP growth to 8% per annum and reduce the number of people living in poverty in the country from 40% down to 15% by 2021
• Large domestic market – Bangladesh has a population size of about 160.0 million people in 2012 with growing per capita income and has formed a large domestic market for economic expansion.• Large regional market – The South East Asian and North East Asian countries with a combined large population size of more than 1.9 billion people has formed a large consumermarket to support Bangladesh export goods.
Bangladesh GDP contribution by major sector
Source: www.worldbank.org and World Factbook (www.cia.gov)
Growth of industrial sector and share to GDP
Investment Prospects in Bangladesh
The government has set its economic growth target to 10% in 2021 with an average of 7.3%, in its Sixth Five Year Plan.
To fulfill this vision the Government has facilitated manufacturing sectors that would eventually contribute 30% to national income.
Stable GDP growth for last decade
Annual export is about USD 24 billion in FY 2012-2013
Export grew 10.7% in 2013
Planning to export USD 5 billion leather goods in the next decade
Predicted RMG export upto USD 40 billion within 2021
IT companies are growing 20-30% a year
Investment Scope in Bangladesh
Through export diversification several emerging exports are showing high potentials: Agro-products and agro-processing productsLight engineering ( including auto-parts and bicycles)Leather products and footwearPharmaceutical productsSoftware and ICT productsHome textileOcean-going Ship Building IndustriesToiletry productsElectronicsPlastic
Proposed Industries
Construction Materials Industries
Fulfill the needs of Bangladesh’s urbanization and reduce imports in the construction sector
Textile andClothingIndustries
Possible spillover from nearby EPZs/SEZs which are already saturated, due to resource or other limitations
Food ProcessingIndustries
Utilize marine and other produce resources in thisregion, and generate jobs that are easier to be adopted by the locals
Supply Base Utilize the richness of marine based resources inthis region Tourism Utilise the beautiful and well conse
Tourism Utilize the beautiful and well conserved naturalenvironment and culture of Babgladesh
Residential Residential will play a crucial role
of
providing housing and social infrastructure for the workforce and other residents
Self reliant: integrated residential
development will include other supporting infrastructure like hospitals, schools, commercial
establishments Enhance quality of life: parks,
places
of worship, sports complex, public transport system
Built in phases and market-driven Sustainable development
MARKET RESPONSIVE
LINKAGE TOINDUSTRIES
ADAPTABILITY
DIVERSITYOFREAL ESTATEPRODUCT
MINIMISECOST
LOW TOMEDIUMRISE
SELFRELIANT
SELFRELIANT
COREINFRA
COREINFRA SUPPORTING
INFRASUPPORTINGINFRA
POPULATIONSIZE
POPULATIONSIZE
SUSTAINABLESUSTAINABLE ECOLOGICALPERFORMANCE
ECOLOGICALPERFORMANCE
TRANSITORIENTED
TRANSITORIENTED
WALKABLEWALKABLE
CONTEXTSENSITIVE
CONTEXTSENSITIVE
Investment Opportunities Why invest now?
Government support Legal framework
Incentives Infrastructure
Factors supporting asuccessful economic zone
Investment OpportunitiesWhy invest now?
Dedicated to promote and sustain SEZCommitment to dedicate resources to monitor and market theSEZ to promote investment into both Phase One and subsequentexpansion phases
Dedicated to promote and sustain SEZCommitment to dedicate resources to monitor and market theSEZ to promote investment into both Phase One and subsequentexpansion phases
Government support
Legal framework
Incentives Infrastructure
Factors supporting asuccessful economic zone
Why invest now?Government support
Legal framework
Incentives Infrastructure
Factors supporting asuccessful economic zone
Tax Holiday • 10 years tax holiday in 15 years may be approved. • After tax holiday period i.e. 11th year 70%, 12th year 30% may be
exempted.
• However, no tax relief from 13th year VAT on Electricity • VAT on the electricity bill for the electricity that will be purchased or
produced by the developer, may be exempted up to 10 years VAT on Local Purchase
• All purchases from Domestic Tariff Area except petroleum can be exempted from VAT
Subsidy • Proposal for providing subsidy upto 50% of cost of setting up CETP may be considered
Custom Duty • Exemption from custom/excise duties for development of SEZ/EZs may be considered
Stamp Duty • Exemption of stamp duty and registration fees for registration of SEZ/EZ land but limited to first transaction only and for registration of loan/credit document, may be considered
Stamp Duty • Exemption of registration fees for registration of loan/credit document, may be considered
Income tax others • Exemption from dividend tax may be considered
Income tax others • Exemption from service taxes payable against the services provided by the developers may be considered
Investment Opportunities
Proposed incentives to the EZ/SEZ Developers
Why invest now?Government support
Legal framework
Incentives InfrastructureHead of Incentives Package
Tax Holiday • 1st and 2nd year: 100% , 3rd year 80%, 4th year 70%, 5th year 60% , 6th year 50%, 7th year 40%, 8th year 30%, 9th year 20% and 10th year 10% income tax exemption can be considered
Custom Duty • Import duty may be exempted for import of capital machinery for using in EZ/SEZ
• The same may be exempted for import of construction materials and raw materials which are not locally much available
Income Tax Others • Dividend tax exemption may be considered after tax holiday period is elapsed
Repatriation • Repatriation of capital and dividend to home country may be considered
Free flow of FDI • Provision of no ceiling of FDI may be considered
Backward Linkage • Duty on Import of Raw material by backward linkage industries in DTA, feeding 100% export oriented industries, may be exempted
Local Sale • Industries in EPA may be allowed upto 20% local sale
Subcontracting • Subcontracting with the units in the DTA may be allowed
Stamp Duty • Registration fees and stamp duties for registering lease deeds for leasing land/factory space may be exempted by 50%
VAT • VAT for use of utilities in SEZ/ EZs may be exempted for 80% instead of proposed 100%
Proposed incentives to EZ/SEZ users/investors
Investment Opportunities Why invest now?
Proposed incentives to EZ/SEZ users/investorsHead of Incentives Package
Custom Duty • Duty applicable to export may be exempted
CD on Vehicle • CD on import of vehicles (upto two only for one time) within 5 years of establishing the unit in the EZ/SEZs may be exempted.
Double Taxation • Double taxation may be avoided subject to existence of double taxation avoidance agreement.
IT Individual • 50% rebate on income tax of individuals with technical knowhow employed, upto 5 years of establishment of industrial unit, may be allowed
Custom Bond • The facility of custom bond area may be given to the units in the Export Processing Area
Foreign Exchange • Foreign currency loan may be allowed based on existing rules and laws
Foreign Exchange • Non-resident working in EZ/SEZ may be allowed to open FC account.
Foreign Exchange • FC account may also be allowed for both local and joint venture industries.
Joint Venture • Foreign investors should be free to enter into joint venture with local investors
Royalties • Tax on royalties and fees earned for technical knowhow may be exempted and may be repatriable.
Capital Gain • Tax on capital gain from transfer of shares may be exempted
Share Transfer • Foreign investors may be allowed to transfer their shares to local shareholders
Work Permit • 5% of the staff of an industrial unit, from abroad, may be provided work permit
Reinvestment • Repatriable dividends if reinvested may be treated as new foreign investment
Residentship • Resident visa may be provided for investment of US$ 75,000 or more.
Citizenship • Citizenship may be provided to foreign investors investing US$ 5,00,000 (five lakh) or more
Investment Opportunities Why invest now?Government support
Legal framework
Incentives Infrastructure
Factors supporting asuccessful economic zone
The Government is committed to investing in the surroundinginfrastructure in order to spur the development of the SEZ.This includes:► Energy► Telecommunication► Water► Road upgradesCurrently Mirshorai offers the following:► Domestic airport► Commercial jetty► Road connecting Main highway to proposed zone
Figure 1: Proposed sub zone one (Eastern Side of Muhuri Project road )
mirshorai economic zone project
mirshorai economic zone project
Figure 2: In-betweens CDSP and BWDB Embankment ( Sunni Mijirteck village- Western side of BWDB Embankment and eastern side of CDSP )
Figure 3 : Eastern side of CDSP (Ponds) Figure 4 : Western side of CDSP ( Forest)
mirshorai economic zone project
mirshorai economic zone project
Figure 5 : Bamonsundor canal –towards the Bay of Bengal Figure 6 : View of Bamonsundor canal- towards the Bay of Bengal
Figure 8 : End of the Bamonsundor Canal ( Shadur Char North of canal)
Figure 7: End of the Bamonsundor Canal ( Shilpa Char South of canal)
mirshorai economic zone project
Item Detail Comments
Access & Utility 182 KM from Dhaka, 66 KM to Chittagong , 79 Km from Chittagong Airport , 67 KM from Chittagong port
Land Gross & Net Gross area 7716.97 acre ( 2170.75 Khas Land, 3126.03 Permanent Lease and 2420.19 private land)
Electricity line Mithaichora Sub-station within 9 KM from zone or Zorargonj Sub-station witnin 8 KM of zone which is under construction
Gas Line Gas line within 9 KM of zone beside Dhaka-Chittagong high way
Source of Sweet water
Muhuri river within 10 KM of zone
Access Road Zorargonj – Muhuri Project road ( If the zone 1 established at first) or Barotakia-Abu Torab Bazar-Mogadia raod (DC Obaidullah Road) if the Southern part start first.
mirshorai economic zone project
Sunset At Potenga Sea Beach Chittagong : Patenga is a sea beach located 14 kilometres south of the port city of Chittagong, Bangladesh. It is near the mouth of the Karnaphuli River.
recreational placees of chittagong division
Moha Maya, the second largest man-made lake in Chittagong after Foy's Lak
recreational placees of chittagong division